Is Gladstone Capital Corp. overvalued or undervalued?

As of 3 February 2021, the valuation grade for Gladstone Capital Corp. has moved from risky to very attractive, indicating a significant improvement in its perceived investment quality. The company is currently undervalued, with a P/E ratio of 7, a Price to Book Value of 1.23, and an impressive Dividend Yield of 16.07%. Notably, its PEG Ratio stands at an exceptionally low 0.05, suggesting that the stock is priced attractively relative to its growth potential.
In comparison to its peers, Gladstone Capital Corp. has a lower P/E ratio than PennantPark Floating Rate Capital Ltd., which has a P/E of 14.91, and Trinity Capital, Inc. at 7.23, both of which are also considered very attractive. The company's ROCE of 22.58% and ROE of 17.81% further reinforce its strong operational efficiency relative to its peers. While the stock has underperformed the S&P 500 year-to-date, it has outperformed over a one-year period, returning 17.39% compared to the S&P 500's 10.26%.